Gold Prices Rise on Demand for Haven; Silver, Platinum Advance

Source: Bloomberg (12/24/08)

"Gold prices rose on speculation the recession will deepen."

"Gold is being supported because there's still a significant amount of fear out there," said Leonard Kaplan, the president of Prospector Asset Management in Evanston, Illinois. "That's driving purchases."

Gold futures for February delivery rose $6.50, or 0.8%, to $844.60 an ounce at 11:15 a.m. on the Comex division of the New York Mercantile Exchange. Silver futures for March delivery gained 11 cents, or 1.1%, to $10.37 an ounce. Platinum futures for April delivery climbed $12.80, or 1.5%, to $863.30 an ounce on the Nymex. Palladium for March delivery rose 30 cents to $175.

Investment in the SPDR Gold Trust, the biggest exchange-traded fund backed by bullion, has remained at a record 775.3 metric tons since Dec. 17. "Gold has some catching up to do on the downside," Kaplan said. "In a deflationary recession, gold goes down, but it goes down less than other assets."